Dollar General 2009 Annual Report Download - page 58

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Contractual Obligations
The following table summarizes our significant contractual obligations and commercial
commitments as of January 29, 2010 (in thousands):
Payments Due by Period
Contractual obligations Total < 1 year 1-3 years 3-5 years > 5 years
Long-term debt obligations .......... $3,409,748 $ 1,723 $ — $1,963,500 $1,444,525
Capital lease obligations ............ 8,327 1,849 1,979 607 3,892
Interest(a) ...................... 1,456,713 267,778 535,265 471,232 182,438
Self-insurance liabilities(b) .......... 213,710 68,245 93,051 31,048 21,366
Operating leases(c) ............... 2,325,037 423,813 733,842 509,685 657,697
Subtotal ...................... $7,413,535 $763,408 $1,364,137 $2,976,072 $2,309,918
Commitments Expiring by Period
Commercial commitments(d) Total < 1 year 1-3 years 3-5 years > 5 years
Letters of credit ................ $ 15,351 $ 15,351 $ — $ — $ —
Purchase obligations(e) ........... 717,359 716,885 474 — —
Subtotal ..................... $ 732,710 $ 732,236 $ 474 $ — $ —
Total contractual obligations and
commercial commitments ........ $8,146,245 $1,495,644 $1,364,611 $2,976,072 $2,309,918
(a) Represents obligations for interest payments on long-term debt and capital lease obligations, and
includes projected interest on variable rate long-term debt, based upon 2009 year end rates.
(b) We retain a significant portion of the risk for our workers’ compensation, employee health
insurance, general liability, property loss and automobile insurance. As these obligations do not
have scheduled maturities, these amounts represent undiscounted estimates based upon actuarial
assumptions. Reserves for workers’ compensation and general liability which existed as of the date
of our 2007 merger were discounted in order to arrive at estimated fair value. All other amounts
are reflected on an undiscounted basis in our consolidated balance sheets.
(c) Operating lease obligations are inclusive of amounts included in deferred rent and closed store
obligations in our consolidated balance sheets.
(d) Commercial commitments include information technology license and support agreements,
supplies, fixtures, letters of credit for import merchandise, and other inventory purchase
obligations.
(e) Purchase obligations include legally binding agreements for software licenses and support, supplies,
fixtures, and merchandise purchases excluding such purchases subject to letters of credit.
Other Considerations
Our inventory balance represented approximately 47% of our total assets exclusive of goodwill and
other intangible assets as of January 29, 2010. Our proficiency in managing our inventory balances can
have a significant impact on our cash flows from operations during a given fiscal year. As a result,
efficient inventory management has been and continues to be an area of focus for us.
At January 29, 2010, our South Carolina-based wholly owned captive insurance subsidiary, Ashley
River Insurance Company (‘‘ARIC’’), held money market investments equaling $20.0 million which
were reflected in our consolidated balance sheet as cash and cash equivalents. These investments were
47